Overview of GST in India

  • Introduction

Goods & Services Tax is a tax leved on goods supplied and services rendered in India. The taxable event in case of GST system is supply. This is based on the concept of  destination of the supplied goods and services rendered.

  • Background

On 01-07-2017, GST was made applicable in India. It subsumed many different types of taxes and gave rise to a Single Tax Single Nation theory where in uniform rates of taxes are levied across all the states of India. After the introduction of GST in India, the credit flow mechanism also moved without hurdles.

  • Basic Components of GSTCGST- Central Goods & Services Tax.SGST- State Goods & Services Tax.IGST- Integrated Goods & Services Tax.
  • Levy Mechanism

Under GST, all the transactions which takes place within a state attracts two types of taxes i.e. SGST & CGST whereas in case of those transactions which are inter-state means which takes place between two states then IGST plays its role.

  • Taxes eliminated after introduction of GST in India

Central Excise, Service Tax, CST, VAT, Entertainment Tax, Luxury Tax, Octroi and Entry Tax, Purchase Tax.

  • Items outside of  GST compliance

Petrol / Diesel / Aviation fuel / Natural Gas, Electricity

  • Types of GST Rates in India
  • Exempt – 0%
  • Precious Stones – 0.25%
  • Gold – 3%
  • Merit Rates – 5%
  • Standard Rates – 12% & 18%
  • Demerit Rates – 28%
  • Compensation Cess – levied over and above the demerit rates
  • Registration under GST

Threshlimit for registration under GST is Rs. 20 lakhs for special category states (Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh and Uttarakhand) and Rs.40 Lakhs for rest of India. Generally GST registration takes 3-4 days time.

  • Types of GST returns
  • GSTR – 1: Return for Outward Supplies.
  • GSTR – 2: Return for Inward Supplies.
  • GSTR – 2A: Read Only Document.
  • GSTR – 3B: Summary of Inward and Outward Supplies.
  • GSTR – 4: Return For Composition Dealers.
  • GSTR – 5: Return For Non-Resident Taxable Persons.
  • GSTR – 6: Return For Input Service Distributors.
  • GST Conclusion

Though GST is a perfect taxation system which is almost adopted by every developed nation and this shows that India is also on its way of becoming a developed nation but still there are some hurdles on way. Still lots of development is on way. Continuous improvements are taking place in GST return forms and steps are being taken to make it simple and easy for common people.

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